Good morning, guys, and welcome to our Q2 presentation for 2026. Presenting this quarter comes with a bit of mixed feelings. If we start with the good things, on one hand, of course, we see very strong own e-com growth. Almost all categories within e-com are doing really well. Even footwear is growing. It is increasing profitability, very strong gross margins. That is clearly the highlight of the quarter. However, of course, when we look into the overall sales development, that is a disappointment. We are behind last year, which means that we come from 25 consecutive quarters with growth. That stops right now, and of course, that is a big disappointment and something that we are absolutely not happy with. Sales is declining. It is related to our wholesale customers coming into the year with a bit of a poor order book. Also, of course, related to early deliveries.
Even if we look at the half-year numbers, we are slightly behind last year. Here we simply need to do a lot better going forward. However, of course, looking at the gross profit, that is another victory. We are trading in the right direction. It is a mix of predominantly three different things. On one hand, reduced discounts. We also see, of course, still strong currency effects that is having a positive impact, even though it is slowing down a bit. Also the channel mix. Of course, with e-com doing so well, that of course means it takes a bigger share of the business. With own e-com, we are doing between 76% and 77% gross margin. Of course, that is helping our gross margin increase, which is very good. Operating profit. Of course, despite then a negative sales development, we are improving our profit.
Actually looking at first half year, we have never made more money in the history of this company. Of course that is good. I think at least, the key message with Q2 is we are not happy with the sales performance. We need to do better. That is very clearly. Looking at a long-term plan, of course, we are here not for the quarters, but for the long run. I think we are onto something very strong, and we believe that there is a strong resonation with the whole idea of inspiring people to move more. We feel that people are training more and more. Despite, of course, the world being in a very challenging place, people spend more time investing into themself.
We believe that there is a very strong spot or position for a brand like Björn Borg to continue to inspire people to work out, to activate themself as a way of becoming stronger in whatever you want to be stronger at. This slide is an illustration of what we have done in Q2, and I think we have not talked so much about that. Yesterday we had a long AI workshop, just reviewing all the projects that we have been launching and the outcome of those projects. On one hand, we can see that AI is making us much more efficient and effective. One example we talked about yesterday is when it comes down to writing all the text around our products. We now of course do that through AI, saving us somewhere between SEK 600,000 and SEK 700,000 a year.
Also, of course, it saves a lot of time, and it makes also the quality much better. But on the other hand, we believe that when it comes to building the brand in a world where almost everything is fake, we need to continue to be real. So activating the brand with real people out there I think is crucial for us. We have done hundreds of activations during Q2. One was just ASCARO. It is across the street here, with a padel event. We are activating ourselves in all the major cities with a very strong impact. I think that is the way to really build this brand. Real stories with real people. Only yesterday when we had our board meeting closing Q2, I just looked outside the window at the Frösundavik and there I saw 70, 75 people that were joining our running club.
I think that is another example of reaching out and building a strong connection with end consumers, and we need to continue doing that, and I think we are doing that really well. Also, of course, that is partly why our own e-com is going so well. It is really resonating well with what we do with end consumers out there. So that is reassuring, and of course, we need to continue doing that. Looking at the sales development, and again, of course, Q2 is a disappointment. Partly, of course, we delivered orders earlier. But also when you look at the first half year, we are slightly behind last year's numbers. So, it is a poor sales development. Again, the highlight is really own e-com. It is only related to wholesale and a couple of big customers. So here we simply need to work more and harder. Looking at the categories.
Well, of course, with wholesale declining a bit means that also most of the categories are declining. But if you dig a bit deeper and you try to look for victories and see what is actually working, we can conclude on one hand that training, so the stuff we do for those that go to the gym, is going really well. Both for adults, but also for Kids. So we see that our junior collection is developing fantastic, growing 53% versus last year. footwear is declining, and of course, that is a major focus. So we need to change that trend. The highlights with footwear is that in own e-com, we are growing. Sweden is growing. However, of course, we still see big drops in Netherlands and in Belgium. So the work here continues. I have been asked a couple of times, how long will you do this?
Just to remind you all, footwear, even though of course we are declining in turnover, is still profitable. We are making money here. The ambition, of course, is to turn this into a SEK 500 million or SEK 600 million category. Currently, we are closer to SEK 70 million, SEK 80 million rolling 12. Of course, we want the SEK 500 million to happen quick. It is going to take a bit of time. But we will continue to focus on footwear. We believe that the brand is strong, the brand is able to have multiple different categories of which footwear should be one. Bags is doing okay, growing in the quarter, and our Swimwear collection has been doing good. Of course, partly thanks to an exceptional, really good weather, sometimes a bit too warm, of course, during Q2. So overall, a few highlights and other things that is not working according to plan.
Simply more work to be done. When we look at the countries, with wholesale declining, we see that then in all of the markets. Finland is holding on really well. Norway is also rebouncing a bit. Looking at the channels then. Wholesale, as we said, is declining, partly due to timing, but also partly due to a bit of a lower order book. e-commerce is doing very well. Growing 17% in the quarter. Profit is increasing. Profit ratio is increasing. There's a lot of highlights with e-commerce and that's the channel where we're closest to the consumer, so that's super good. Retail is struggling as well. Comparable stores is declining at 5% and we can conclude that the traffic is really dropping during the summer when the weather is what it is. Distributors are doing okay, mostly then, thanks to Norway.
Our focus channels is wholesale and e-com. e-commerce is working good. Wholesale is having a weak quarter and here we simply can do better. We are here to grow. We're not growing. That is simply not good enough. For us and for me, it's back to work and show you guys that we can do a lot better. I think with that said, let's dig into some of the other numbers, where actually things looks a lot better. With that, Jens, why don't you showcase a bit the margin development here in the quarter?
Will do. Thanks a lot, Henrik. Good morning to you all. In a world that sometimes feel you don't know really what's real or what's not, it's good to be back from the summer, at least, to find your colleagues that are certainly real. That makes me filled with energy to continue this journey and develop this company. Clearly, as you heard, the Q2 was a disappointment in terms of sales. There are some highlights, however. Looking at the gross margin, it's improving versus last year. You can really split that into three parts if you want, for the Q2. It's partly, as you heard from Henrik, our own e-commerce is growing with a high gross margin that takes a bigger share of the total, meaning that the share of the segments or the channels is improving the margins.
Otherwise, we have a favorable FX development in the quarter that helps the margin as well, and also product mix that is going in the right direction. That's all combined helping to a very good gross margin in the Q2. That's one highlight. The operating profit as well is improving 11% versus last year, so that's good in a quarter where, as you already heard now, we're losing or dropping sales. Quite pleased with the fact that we can drive a profitable company here despite the sales is dropping. Clearly being helped by favorable FX, but also the channel mix, as you heard before, is helping the profitability. That's two good things in an otherwise slightly disappointing quarter. If we summarize all this in a simplified P&L, you already heard sales is dropping 12%. However, the gross margin, as I just mentioned, is up 5.6 points.
The operating expenses is more or less where we want them to be, so we have good control on that. The EBIT margin, as I mentioned, up 11%. That is overall disappointing on sales, but in other places, a good P&L, I should say. In terms of the equity or the solidity, quite stable, dropping slightly, 0.5 points versus last year, but still on high levels. The net debt is decreasing, which is really good considering everything that is happening. So I am very pleased with quite a big drop in the net debt. Our working capital is really stable. So at least when you compare it to the gross sales rolling 12 months, flat versus last year. So around 20%, 21%, that is where we want it to be, obviously focusing on the right things. That was a few highlights from the bottom lines.
With that, Henrik, why don't you close this one?
Yes. Thank you, Jens. Again, if we should then at least close the quarter with some things to be proud over. We just launched golf. That is working really well with very strong sell-through numbers. However, still small volumes. But I think it also tells that the brand is ready to launch a new category, new product groups. Secondly, our e-commerce is doing really well. So growing 17%. Apparel within our e-commerce is growing 28%. I think that is something that we are super proud over. Lastly, profitability is increasing. Looking at first half year, we never made more money in the history of this company. So that is also something that we are super proud over. Again, however, it was a weak quarter in terms of sales. We need to grow. We don't grow, and that needs to change very clearly.
I think with that said, thank you for listening in. I am sure that Hjalmar has tons of good questions as well. So, hang on for a few more minutes and let us see where this will take us.
Thank you so much, Henrik. Let's start at the wholesale segment. You mentioned the timing effect, and we know between Q1 and Q2 that there were some timing effects. If we disregard this, are you satisfied with the underlying development in the wholesale segment if we evaluate the first half of the year?
No, I think it's a big disappointment. I think if we look at first half year, we're down, I think, 1% to 1.4% on top line, and of course, we want to grow 10%, so that is not at all according to plan. Of course, the way the business works with wholesale is that we do pre-orders the year before. The order book that we took last year, in August 2025, was a bit weaker than what it was the year before. Then, of course, in order to catch up, you need to do more reorder, more Never Out of Stock, more e-com. But that was a bit tough to catch for that gap that was created with a poor order book. That poor order book was related to one or two accounts.
Actually, most things are doing good, but of course, if you have a big account that is buying a bit less in pre-orders, then of course, it's hard to catch up.
Yeah.
First half year, from a sales perspective, wholesale is a disappointment very clearly.
Okay. Is it fair to assume then that this is not reflecting a widespread decline, but rather isolated at a few accounts? Or how do you feel that this development is maybe comparing to the market? Are you going in line with the market, or how is your market share developing?
If we look at sell-through data, not perhaps so much than our total sales, we see that we're performing really well, both with our wholesale customers, so they're selling out their products at a good pace, but also, of course, with own e-com. The brand is strong. People are buying our stuff. The issue, of course, was that we came in with a poor order book, so of course, that stuff has been sold out. We simply need to be better, of course, tying the big key accounts, wholesale partners closer to us, and driving growth with all of them. Of course, we know that we have a few really big ones, like a Zalando or a Boozt, XXL, Stadium, and of course, if one of those are declining, it's hard to catch up, of course. But we need to grow with all of them.
I believe our strength has been that we're good in wholesale, but also very strong in own e-commerce, and we need to manage both.
Yeah.
Clearly, of course, this first half year has indicated that the wholesale is not performing the way we would want it to perform.
Yeah. Okay. Thank you. Tying all this together, as it relates to your financial targets, of course, a lot of moving parts, a lot of external items as well, but how should we look at your growth trajectory going forward? How will you balance the profitability target with the growth and, of course, some things are in your control, some things are out of it, but just how do you perceive this split going forward?
I think what we can see, though, is that we're well above our profit target in terms of what we've said. So we said a minimum of 10%, and we're simply doing a lot more, more than 11. On the other hand, of course, sales is flat and we want to grow 10%. Of course, yes, we come from 25 consecutive quarter of growth, so of course, it's the first quarter that we don't grow in a very long time. So on one hand, I don't want to overplay that, but I think it's very clear. Our challenge is not profitability. Our challenge is to grow quicker. So of course, it's all about looking at our investments, looking at what we do, and we simply need to generate more growth in all the channels, e-commerce, but also, of course, the wholesale customers.
Without them giving away the future, we're here to deliver on our financial targets. We're currently not doing that from a sales perspective. We need to do better.
Yeah. Okay. Thank you. The gross margin, of course, very strong. But this is a channel mix question among other items. How would you balance these items in the second quarter? Of course, the big split, I guess, is the sales market driver. How do the other items, the FX and pricing?
Actually after Q1, a couple of you guys actually reached out to us and asked why we do not disclose, of course, the full impact of currencies, for example. If we take Q2, our gross margin is up, I think 5.6% roughly. If we divide that into what is increasing it with the 5.6, we can see that there are three things that have an equal impact on the gross margin in a positive sense. One, of course, is the channel mix, like Jens just talked about. Of course, e-commerce is taking a bigger share. Here we have 77% gross margin, so that is lifting it. That is one third of it, roughly. The other one is related to the wholesale drop, because of course it is the big key account that dropped a bit. They have the highest discounts. We have lower discounts within wholesale. That is one third.
The last one third is then currency. Still, we are buying in US dollar, we are selling in euros and SEK, and even though it has been flattening out a bit, actually, it is still having a positive impact in Q2. Those three, not exactly, but close to exactly standing for one third each in Q2.
Okay. Thank you. That is very clear. Even if we look at the FX items, of course, like you mentioned, the profitability is on a very good level right now. Could it be fair to assume maybe that you want to invest some more in growth going forward? Maybe to drive their own direct to consumer channels, or how should we view that? Are you happy with the marketing yield that you are getting right now and what could we expect for this?
No, but I think, when we look at the way we spend our money, of course, there's a big chunk that you don't know whether you're getting something back for. You have a feeling. Then, of course, there's components around Performance Marketing Meta where you know exactly. And of course, when I look at our Return on Ad Spend where we can measure performance, those are very high. So that indicates, of course, that there's room for us to invest even more, which, of course, will drive e-commerce even further and potentially strengthen the brand. That's something we're looking into. However, of course, our approach has been we want to grow, and we also want to be a very strong partner to our biggest key accounts.
We want to invest in them, we want to invest into the brand so they can sell out our products at better margins. And of course, Performance Marketing is not going to help that. So we want to invest in both, continue to drive on e-commerce, but also, of course, invest into the brand so we can grow even more, or start growing, if you look at Q2 then, with our wholesale customers.
Yep. Thank you. And if we stay on the topic then of growing with the wholesale customers, what is, do you think, the key challenge here? If we look at maybe the product offering, is it upselling new items, the focus areas that you launch, or is it maintained growth within the legacy categories maybe? What do you see the key item is to drive growth for the wholesale?
No, but I think it is to continue to do what we're doing. But I think what we need to be better at, we have a couple of really big customers, and of course, we need to build a broader base of strong wholesale partners, because then, of course, we will be less impacted if one decides to buy a bit less or decides to do something that will have an impact on us. So I think it's more that. It's a bit about strategic key account management that we need to build, than go to markets slightly different, because that's actually working. Many of our big key accounts is doing fantastic, and we're growing really well.
But of course, if you then have one or two that is buying high volumes and they decide to do something, dropping their purchase or focusing on cash flow or something that will have an impact on how they're buying from us, then that has an impact. And of course, we simply need to spread the base a bit broader with wholesale.
Yeah.
I think that's more my key take here, so we're not so dependent on a few.
Okay. Yep.
But very clearly, I think we have a good product proposition. We know how to drive wholesale. We need to continue to build strong partnership and be really close with those, so we are really their best business partners. No matter whether it's Boozt, Stadium, XXL, or Zalando, they all require slightly different support. And we need to be the one that is there with them, helping them to drive sell-through and win consumers.
Yep. Thank you. That is very clear. If we look then at the geographical markets, Germany, maybe if we disregard the online channels there, just look at maybe the launch. What is the progress here, and what are your focus areas for growing in Germany?
The focus in Germany has been to really take ownership over Hamburg. It is a bit of a three-legged approach. One, drive German sales within Zalando, so the Zalando business that goes to German consumers. Zalando, of course, sells in all European markets. That is one hand. Of course, our own e-com towards German consumers. Then, of course, build a wholesale base in Germany, but starting with Hamburg. So all those three we are doing. Looking at the year to date, Germany is roughly about flat with declining in Q2. We can see that on one hand, the Zalando business, so them selling to German consumers, is doing really well. Here we are growing. However, our own e-commerce in Germany is flat declining, 1% full year. Of course, here we need to change. The big challenge here is then when we look at Performance Marketing.
We give the e-commerce team a kroner to invest. Of course, if you want to make the most out of that, you then invest into markets where the brand is stronger because you will get more back. Whilst, of course, in Germany, you will not get as much back for that kroner invested, but you want to do it anyway for the long run. Of course, that is the constant balance you need to manage, simply. We can invest more in Germany own e-commerce, and that, of course, will enable us to grow there. But if we take exactly the same money and put it into another market, we will probably grow twice the pace. So we need to find that balance. I think we need to invest even more here, even though it is not going to pay back as much as some of the other markets.
Own e-commerce Germany, we need to do better. The last, of course, is to open up new customers. Here we have a new country manager that joined us last Monday, actually, who will then help us to start building strong relationship with German wholesale customers. That business is very small currently, and that we need to focus now with this new country manager. But it is all those three needs to come to play at the same time. Then, of course, building this from Hamburg and then expanding, of course, outside Hamburg. So that is the focus. One reflection potentially is if we see that consumers in Scandinavia are picking up a bit, we do not really see that at all in Germany.
Still a fairly pessimistic outlook on the world, on the economy in Germany, where in some other markets, we've seen that, well, the trend actually shifting a bit to be a bit more positive.
Yeah.
We're so small, so we should be able to grow anyway.
Yeah. A bit of a challenged consumer in Germany then, I guess.
Yes.
Yeah. Finally on online, could you just remind us of the drivers of this impressive growth that we see now in the quarter? Maybe do you feel that you still have good pricing power here? We saw the gross margin remains very strong in this channel. What are the prospects here going forward?
No, but I think e-com both year to date and in Q2 looks very promising. Which, of course, is an indication that there is a lot of consumers out there that really want to buy stuff from us. On one hand, sales is growing, gross margin is up, profit in absolute numbers is up, profit ratio is up. I think everything is simply pointing in the right direction. Also when we see Performance Marketing and the stuff that we are doing there, the Return on Ad Spend that we are having is record high. That is up, I think 34%, 35% versus last year. If we put in one kroner, we will get 34% more revenue this year versus last year. Already last year was really good.
Yeah.
Of course, there is something happening here that is very strong.
Yeah.
Super proud and super happy over e-com. Clearly one of the highlights in the quarter.
Yeah.
But we're not only an e-com company. We want to drive, of course, all channels.
Yeah.
That I think is key for us to grow 10%.
Perfect. Yeah. Thank you. Very clear. That's all on my end, so I'll leave it to you for any concluding remarks.
Excellent. No, thank you, Armand. Good question as always. Again, of course, we had 25 consecutive quarters of growth. We were hoping, of course, it would be a 26th one. This is simply not good enough. There are highlights, and of course, you can talk about them in circles. But we're not happy with the sales growth. We can do better. I think that's the key message. We simply need to shape up. That's it. So, have a fantastic Friday. Don't forget to work out. Remember, we're here for the long run. We want to build a global, iconic sports fashion brand that really inspires people to move, and that hasn't changed just because we're dipping sales in one quarter.
Thank you.
Brilliant